An AI U-turn ?
JP Morgan's Mark Schilsky argues that investors are becoming increasingly convinced that hyperscalers' massive AI investments are generating returns well above their cost of capital. After reading the latest quarterly earnings transcripts from Amazon, Microsoft, Alphabet, and Meta, that view is becoming difficult to dismiss. Management teams sounded more confident than ever that today's unprecedented AI spending will translate into sustainable, long-term earnings growth. If Schilsky is correct, the valuation multiples of the Magnificent Seven may have already reached their lows. As confidence builds that AI capex is creating durable value rather than simply driving higher costs, investors could once again be willing to pay premium valuations, potentially well before free cash flow bottoms and begins to accelerate. Source: TME
This chart shows how the AI capex boom is fast becoming the largest investment surge in history
compared with previous economic booms such as Britain’s railway mania and America’s dotcom bubble. But the spending could still generate disappointing returns Source: The Economist
Gold is coiling and getting ready for a big move
Bollinger Bands are now the tightest since August 2025, right before Gold soared 60% over the next 5 months. Source: Barchart
Indian investors holdings in U.S. stocks hit all time high
Holdings are up +1500% since May 2016 Source: FRED
Yesterday saw Momentum's single-biggest daily gain since 2003...
Source: zerohedge
Nasdaq 100 $QQQ is now on track for its worst July in 24 years
Source: Barchart
This is what a rotational market looks like
S&P 500 Equal weight (white bars) juste made a new all-time high Nasdaq (in green) is getting hammered Source: Bloomberg, RBC
Semiconductor Stocks Head & Shoulders Pattern almost completely formed now It's sitting right on the neckline, if it breaks 528, look out
Source: Barchart
